Boeing unfair labor charge dropped

The Boeing 787 Dreamliner, under construction at its unionized plant in Washington state.

NEW YORK (CNNMoney) -- The National Labor Relations Board on Friday dropped its politically charged unfair labor practice case against Boeing over the aircraft maker's plan to move 787 Dreamliner production to a new nonunion plant in South Carolina.

The government board said a new labor agreement between Boeing and the International Association of Machinists, which includes the union's dropping a complaint about the plant, led to the decision to drop the case.

"This is the outcome we have always preferred, and one that is typical for our agency," said NLRB Acting General Counsel Lafe Solomon in a statement.

The NLRB had charged that Boeing decided to open the plant, which has about 1,000 employees, in order to punish the union for past strikes that shut down the aircraft maker's production lines.

Boeing (BA, Fortune 500) officials argued that no union member was hurt by the new plant since it was maintaining full employment at its union-covered plants in the Pacific Northwest. But it said the need to protect itself from the threat of future strikes was a reason for the new plant.

The union said its members' future job security depended on them handling all the assembly of the 787, the company's groundbreaking plane that improves fuel economy through its construction from composite materials rather than aluminum. Last month, the union and Boeing reached a deal to keep production of another new plane, the 737 MAX, at union-represented plants in the Pacific Northwest. In return, the union agreed to a four-year contract extension a year ahead of the scheduled 2012 expiration. The deal was ratified by union members earlier this week.

The NLRB case was a major political issue, with Republicans charging it was proof that the Obama administration is more interested in pleasing unions than creating new jobs.

"Under the leadership of President Obama's appointees the NLRB has become a tool of union bosses," said Jim DeMint, the Republican senator from South Carolina. "The NLRB's dismissal of charges against Boeing only after union approval of their new contract only confirms the charges were a politically motivated negotiation tactic, not a serious complaint based on merit."

The White House has said it doesn't get involved in cases before an independent agency such as the NLRB.

Boeing said it was pleased with the NLRB action, as well as its agreement with the union.

"Boeing is grateful for the overwhelming support we received from across the country to vigorously contest this complaint and support the legitimate rights of businesses to make business decisions," said a statement from the company on Friday.

Machinist Vice President Rich Michalski said he believes the agreement between the union and the company marks the start of a new era in labor relations at the company. But he also thanked the NLRB for bringing the case.

"Despite an unprecedented level of harassment, intimidation and partisan political pressure, the NLRB and its officers measured up to the highest standard of grace under pressure," he said in a statement.

The first 787 Dreamliner went into service for All Nippon Airways in October. United Airlines, a unit of United Continental (UAL, Fortune 500), is set to be the first U.S. carrier to take delivery of a Dreamliner next year.